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Victorino Magat Vs

Victorino Magat filed a complaint against Hon. Leo Medialdea and Santiago Guerrero regarding a breach of contract to procure radio transceivers from Japan. Magat took steps to have the radios manufactured based on representations from Medialdea's agent that he would fulfill the contract. However, Medialdea did not provide the required radio frequency information and blamed delays on Magat when confronted by the U.S. Navy. The court held that both parties were businessmen who intended to derive profits from the contract, and that upon breach, the non-breaching party suffers loss of expected profits, which are recoverable damages. The complaint stated a valid cause of action and was improperly dismissed.

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283 views2 pages

Victorino Magat Vs

Victorino Magat filed a complaint against Hon. Leo Medialdea and Santiago Guerrero regarding a breach of contract to procure radio transceivers from Japan. Magat took steps to have the radios manufactured based on representations from Medialdea's agent that he would fulfill the contract. However, Medialdea did not provide the required radio frequency information and blamed delays on Magat when confronted by the U.S. Navy. The court held that both parties were businessmen who intended to derive profits from the contract, and that upon breach, the non-breaching party suffers loss of expected profits, which are recoverable damages. The complaint stated a valid cause of action and was improperly dismissed.

Uploaded by

Camille San Antonio
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as DOCX, PDF, TXT or read online on Scribd
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Victorino Magat vs. Hon.

Leo Medialdea and Santiago Guerrero

G.R. No. L-37120 April 20, 1983

Facts:

 Isidro Q. Aligada, also acting as agent of the defendant, made representations with the plaintiff herein
to the effect that defendant desired to procure from Japan thru the plaintiff herein the needed radio
transceivers and to this end, Isidro Q. Aligada secured a firm offer in writing.

 Believing that the defendant would faithfully fulfill his contract with the plaintiff, considering his signed
conformity, the plaintiff took steps to advise the Japanese entity entrusted with the manufacture of the
items to the effect that the contract between the defendant and the plaintiff has been perfected and
that advice with regards to radio frequency would follow as soon as same is received by the plaintiff
from the defendant.

 It has come to the knowledge of the plaintiff that the defendant has been operating his taxicabs
without the required radio transceivers and when the U.S. Navy Authorities of Subic Bay, Philippines,
were pressing defendant for compliance with his commitments with respect to the installations of radio
transceivers on his taxicabs, he impliedly laid the blame for the delay upon the plaintiff, thus destroying
the reputation of the plaintiff with the said Naval Authorities of Subic Bay, Philippines, with whom
plaintiff transacts business;

 Plaintiff wrote a letter thru his counsel to ascertain from the defendant as to whether it is his intention
to fulfill his part of the agreement with the plaintiff herein or whether he desired to have the contract
between them definitely cancelled, but defendant did not even have the courtesy to answer plaintiff's
demand.

 The defendant entered into a contract with the plaintiff without the least intention of faithfully
complying with his obligation, he did so only in order to obtain the concession from the U.S. Navy
Exchange, Subic Bay, Philippines, of operating a fleet of taxicabs inside the U.S. Naval Base to his
financial benefit and at the expense and prejudice of third parties such as the plaintiff.

 That in view of the defendant's failure to fulfill his contractual obligations with the plaintiff herein, the
plaintiff will suffer damages.

 Respondent Guerrero filed a motion to dismiss said complaint for lack of cause of action.

 The respondent judge, over petitioner's opposition, issued a minute order dismissing the complaint.

Issue: Whether or not respondent can be held liable for damages.

Held:

Indisputably, the parties, both businessmen, engaged into the aforesaid contract with the evident
intention of deriving some profits therefrom. Upon breach of the contract by either of them, the other
would necessarily suffer loss of his expected profits. Since the loss comes into being at the very moment
of breach, such loss is real, fixed and vested and, therefore, recoverable under the law. The damages
which the obligor is liable for includes not only the value of the loss suffered by the obligee but also the
profits which the latter failed to obtain. If the obligor acted in good faith, he shall be liable for those
damages that are the natural and probable consequences of the breach of the obligation and which the
parties have foreseen or could have reasonably foreseen at the time the obligation was constituted; and
in case of fraud, bad faith, malice or wanton attitude, he shall be liable for all damages which may be
reasonably attributed to the non-performance of the obligation. On the basis of the facts alleged in the
complaint, the court rendered a valid judgment in accordance with the prayer thereof.

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